Thompson served in the United States Army from 1958 to 1960. He moved to Canada in 1968 and became a citizen in 1974. For 23 years, Thompson was a high school teacher and then principal, and later became the mayor of Sundre, Alberta, serving from 1974 to 1980.

He was first elected to Parliament in 1993 as a member of the Reform Party, and continued to serve under its successors the Canadian Alliance and the Conservative Party of Canada. He became known for wearing a cowboy hat, and lobbied unsuccessfully to be allowed to wear it on the floor of the Commons. He claimed that the cowboy hat was part of his heritage, and he had as much right to wear it as MPs had the right to wear turbans or native feathers.